Why Palestine?

5.95%GDP Growth

$8BGDP in 2016

12.2P/E ratio

1.13P/BV ratio

Strategically located, with stable GDP rates and huge potential for growth across many sectors, Palestine offers an excellent investment environment with a stable return on investments. Economically, Palestine is well positioned to become a key destination for international investment in the Middle East. Despite political uncertainty, the Palestinian economy has maintained consistent GDP growth. The country offers undervalued assets, low entry cost, attractive tax and regulatory incentives, and investor protection by the Palestinian Investment Promotion Agency’s Law on the Encouragement of Investment in Palestine. Free Trade Agreements with key trading partners have helped draw the attention of international investors to Palestine. Incentives include 0% dividend tax and 0% capital gains tax, in addition to investor protection by the Palestinian Investment Promotion Agency’s Law on the Encouragement of Investment in Palestine.

In September 2016, Palestine was promoted to frontier-market status by FTSE Russell which has helped put the country on the map for foreign investors. This upgrade assures investors that Palestine’s only stock exchange, Palestine Exchange, operates at a certain standard, and provides that there is liquidity and data transparency.

Palestine’s financial sector is robust and highly regulated by two institutions: the Palestinian Market Authority (PMA) for the banking sector and the Palestine Capital Market Authority (PCMA) for the non-banking sector. The banking sector, which includes the payment systems, micro finance institutions and money exchangers, has well-developed regulatory infrastructure and the PMA has taken important steps to ensure its stability with a credit bureau, payments system, capital requirements and regulations on secured credit. The non-banking sector, comprising the securities market, financial leasing, mortgage finance companies, pension funds and insurance companies, is fairly mature, with regulation and supervision provided by the PCMA.

Despite its potential, the Palestinian market remains largely untapped with enormous scope for infrastructure development and technology advancement. The private sector, which contributes 90% of GDP, lacks access to capital with a financing gap of $50 million. Palestine has a skilled and young labor force with an average literacy rate of 97%, including an increase in female participation from 10% in 2001 to around 19% in 2016.